Life · Chapter 21 · Group Life
Insurable Group Categories & Size
Definition
Almost any group formed for a purpose other than obtaining life insurance is eligible for group life consideration. Insurable groups fall into: single-employer groups, multiple-employer groups, labor unions, trade associations, creditor/debtor groups, and fraternal organizations. Initially only groups of 50 or more were eligible; today the NAIC guidelines set no minimum size, and insurers will cover groups with fewer than ten (10) members. Once issued, insurers usually require a certain number or percentage of eligible members to participate to keep coverage in force.
In plain English
The group must exist for some real reason — work, union, trade, debt, brotherhood — not just to buy insurance. Size barely matters anymore.
Exam tip
History question bait: the old minimum was 50; the NAIC now sets no minimum, and sub-10 groups get covered.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
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